After health, get ready to pay more for property insurance

Mumbai: After hardening of premium under group health insurance three months ago, property and fire segments are also set to witness increase in premium rates from the next calendar year.

"We do see the hardening of property and fire insurance segments beginning from the new calendar year. However, I can't tell you to what extent the premiums are likely to go up into the sector as it will vary from company to company," New India Assurance Chairman cum Managing Director, G Srinivasan told reporters here today.

He was speaking on the occasion of the launch of New India Top-up Mediclaim.

"Market has already hardened in the group health insurance sector for past 2-3 months, so as to bring it in line with the burning cost of the insurers. However, it will have positive impact on the bottomline of his company. Premium hardening has taken place in group health insurance after 3-4 years. Premium rates are slightly catching up with the underwriting," he said.

According to him, New India Assurance has already underwritten premium to the tune of Rs 2,300 crore under the health insurance segment in the first half of the current fiscal, ending September 30 and it was looking at crossing the mark of Rs 4000 crore by the end of the fiscal.

Talking about the health insurance loss ratio in his company, Srinivasan said that it was at 89 percent during the first half of the current fiscal, as compared to the mark of 97 percent during the corresponding period last fiscal.

"It is coming down as more and more people are coming under the health insurance coverage in the country,"

New India has paid Rs 200 crore claim in case of J&K floods and Rs 490 crore in case of Hudhud cyclone, which include the amount of Rs 40 crore claim paid by the company to Rashtriya Ispat Nigam Limited in Visakhapatnam alone so far, he said.

"However our net loss in each of the two cases was at Rs 50 crore only due to the fact that remaining cost was incurred by our reinsurers," he said adding, "Property insurance under the catastrophe category has started hardening after the two catastrophes."

On New India Top-up Mediclaim, he said, "It is available for a maximum sum insured of Rs 15,00,000 on the threshold of Rs 5,00,000 and maximum sum insured of Rs 22,00,000 on the threshold of Rs 8,00,000. The new policy is available to all the people up to the age of 65."

The company has collected global premium of Rs 7,728 crore for the first half of the current fiscal at a growth rate of 13 per cent and the company made a profit of Rs 899 crore during this period, a rise of 40 per cent over the corresponding period of the previous year, he said.

"My company is targeting a global premium of Rs 16,300 crore by the fiscal end," he added.